Private Equity Trends
Report of Private Equity Trends 2008
A new report offers an overview of the last three quarters of private equity trends and where the industry is today.
The private equity industry has begun to significantly feel the effects of the financial crisis, as evident by the Carlyle group’s recent cuts and the latest data revealing reductions in the number and value of private equity deals. This does not necessarily represent a collapse in the private equity industry, but more likely illustrates that many private equity firms are exercising caution toward working in such an adverse climate as well as the lack of credit available for big deals in the current market. PitchBook Data has put together a brief report showing current trends in private equity and which industries is private equity investing.
The above chart shows that private equity deals have significantly dropped, and predictions for the fourth quarter of 2008 are similarly low. To find out where this decline is occurring, PitchBook has broken down the last three quarters of private equity activity by investment sector:
- Business Products/Services: ‘Commercial Services, such as Media & Information and Consulting Services, led this sector with 230 deals in the first three quarters of 2008. The number of deals fell 33.7% and total capital invested fell 76% for the first three quarters of 2008 compared to the same period in 2007. Business Products & Services accounted for 35% of the deals in 3Q 2008.’
- Consumer Products/Services: ‘Consumer Durables led this sector with 54 deals in the first three quarters of 2008, followed closely by Consumer Media with 49 deals. The number of deals and capital invested both fell 39% for the first three quarters of 2008 compared to the same period in 2007. Consumer Products & Services accounted for 25% of the deals in 3Q 2008.’
- Financial Services: ‘Capital Markets/Institutions led this sector with 23 deals in the first three quarters of 2008, followed by Insurance with 22 deals. The number of deals fell 20.8% and total capital invested fell 21.3% for the first three quarters of 2008 compared to the same period in 2007. Financial Services accounted for 5% of the deals in 3Q 2008.’
- Energy: ‘Exploration, Production & Refining led this sector with 46 deals in the
first three quarters of 2008, followed by Energy Services with 30 deals. Number of deals fell 14% and total capital invested fell 58.4% for the first three quarters of 2008 compared to the same period in 2007. Energy accounted for 7% of the deals in 3Q 2008.’
- Healthcare: ‘Healthcare Services led the this sector with 72 deals in the first three quarters of 2008, followed by Devices & Supplies with 29 deals. Number of deals fell 26.6% and total capital invested fell 54.4% for the first three quarters of 2008 compared to the same period in 2007. Healthcare accounted for 11% of the deals in 3Q 2008.’
- Information Technologies: ‘Software led this sector with 42 deals in the first three quarters of 2008, followed by Communications & Networking with 29 deals. Number of deals fell by 44.7% and total capital invested fell 91.4% for the first three quarters of 2008 compared to the same period in 2007. Information Technology accounted for 10% of the deals in 3Q 2008.’
Source: PitchBook Data
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